Boy! Georgia

Interesting to choose to invest in a country bordering Chechnya, and which, although it has been making wines for 7,000 years, still languishes in obscurity

AS THE DUST settles on the Allied Domecq-Peter Lehmann Wines takeover battle, it is interesting to see how the financial press has delighted in this drinks industry take on David and Goliath.

Allied has walked away with little more than a bloodied nose, while Peter Lehmann himself is claiming to have won "a small victory against the march of global corporations", as Lex reported in The FT last month.

Reportedly, the bid by the world’s second largest spirits company was made in order to give Allied its desired foothold in Australia.  However, after this foray there cannot be many more suitable companies left with a similar reputation or the turnover of Peter Lehmann Wines (600,000 cases sold last year at a turnover of £20 illion).

I wonder, therefore, where Allied might turn its attention next? Or whether it is really true, as Mr Lehmann seems to think, that "the march of global corporations" is all bad? Especially in the light of a recent "soft" launch by spirits rival Pernod Ricard.

Allied may have to start to look closer to home again, and with wine interests in New Zealand, Spain and California the company certainly has scope.  But will it be as brave or as eclectic as Pernod Ricard in its choice?

Admittedly, Pernod Ricard does have a broader wine portfolio than Allied at the moment so it could be deemed as having room for diversification; Pernod Ricard is already in Australia and owns other wineries in Spain, Argentina, France and South Africa.

What is most interesting is where its sixth winery is located; a place that would not immediately spring front-ofmind as a wine producing country for many involved in the drinks industry, but one which has been dubbed the "Cradle of Wine" by those in the know.

And while I do not want to go into the much deliberated question of what these two spirits giants are going to do with their wine ranges, it is interesting to consider that the consolidation crusade now dominating the industry is not necessarily always a bad thing.

The "soft" launch to which I refer is that of Pernod Ricard’s new Tamada range; a small collection of only three wines, at the moment, using the relatively unknown indigenous varietals of Georgia – that’s former USSR not present day USA.

Interesting to choose to invest in a country bordering Chechnya and which, although it has been making wines for 7,000 years, still languishes in obscurity. But GWS, the company in which Pernod Ricard has a major shareholding, was eager to embrace the benefits it saw in being involved in a major international drinks organisation.

Perhaps Pernod Ricard was clever to choose to invest in a company and country that needs to build its international standing rather than a country like Australia, whose status has grown so rapidly in the last 10 years it is hard to imagine there was a time when it was once considered the end of the line rather than a must-visit, destination spot.

Brave or risky, Pernod Ricard certainly means business.  According to Peter Carr MW, wine development director at Pernod Ricard UK, who is overseeing the project, it is "incumbent upon Pernod Ricard to get it right for Georgia with the launch of Tamada and not just for GWS.

That is why we have appointed a new winemaker on the ground and a marketing manager here in the UK." Carr continues, "GWS can sell every bottle of wine it makes to Russia. What they need to do now is internationalise.

They can’t afford to put all their eggs into one basket and with this exciting opportunity we are determined to get it right."  Pernod Ricard’s pledge is to sell 20,000 cases of Tamada in the UK by 2006.

Carr claims this is a modest target for a company the size of Pernod Ricard. Some, however, might say it’s ambitious given that the average UK consumer has difficulty grasping the location of Chile, never mind the cultural differences of Georgia.

But the company is keen to promote Georgian culture as a genuine point of difference for the wines.  You have to admit you are certainly not going to get a range of wine made from Saperavi and Mstvane from anywhere else in the world.

Pernod is also putting the weight of its PR machine behind the project and while Illy Jaffar, UK PR manager, is not yet sure of the exact form the campaign will take, he believes PR is the most effective means to help "make the associations between Georgia and the Tamada range real to the consumer".

Both Carr and Jaffar are open about the fact that there are still adjustments to be made to the wine and the packaging, but I for one am impressed by Pernod Ricard’s willingness to drive its corporate vehicle off the well-beaten track and bring consumers the possibility of more choice rather than more of the same.